Media

Over 750 participants from oil and gas exploration and production companies, service and supply companies, financial institutions, and government agencies converged on Wichita for the KIOGA 71st Annual Meeting and Convention held August 17-19, 2008 at the Hilton Wichita Airport.

Also, over 45 exhibitors filled the convention hall for a well attended event. Many legislators, government officials, dignitaries and business leaders from around the nation joined in the convention including U.S. Senator Pat Roberts, U.S. Senator Sam Brownback, U.S. Congressman Jerry Moran, Kansas Speaker of the House Melvin Neufeld, Kansas Secretary of State Ron Thornburgh, 20 state representatives, and 5 state senators. Several media outlets covered the convention including the American Oil & Gas Reporter, Wichita Eagle, Splurge Magazine, The Territorial Magazine, and Kansas Public Radio. The President’s welcome reception kicked off the convention where the group was entertained by the Nouveau Quintette. The KIOGA Convention Committee, led by Mike Reed, once again developed an outstanding program offering excellent speakers, a wide variety of exhibitors, and entertainment. Convention Coordinator, Kelly Rains, did an outstanding job organizing the logistics. A great deal of teamwork made this year’s convention an overwhelming success. Convention participants were able to share ideas, network with peers, participate in thought-provoking sessions, and hear updates on KIOGA’s associational activities.

Keynote Speakers

Keynote Speakers at the KIOGA 71st Annual Meeting and Convention were Art Horn and Dr. Michael J. Economides. Horn is a meteorologist from Connecticut and owner of “The Art of Weather”. He is an expert witness for lawyers in weather related lawsuits and dispels many common myths of climate. Economides is a professor at the Cullen College of Engineering at the University of Houston, Chairman of the Board of Paleon Oil and Gas, Editor-in-Chief of the Energy Tribune, and author or co-author of 14 professional textbooks and books.

Horn discussed and dismissed a number of what he called climate myths perpetuated by global warming alarmists. Horn said that much is not understood about climate change. And much of what the public thinks it does understand is either false or misleading. Noting that plans nationwide to combat global warming revolve around limiting emissions of carbon dioxide, Horn pointed out that water vapor also was a greenhouse gas that absorbed heat in the same wavelength as carbon dioxide. Since water vapor outweighs carbon dioxide, its concentration was 55-110 times that of carbon dioxide. He said water vapor was responsible for 95% of the greenhouse effect compared with 3.6% for carbon dioxide. To counter claims by climate alarmists that increase in atmospheric carbon dioxide concentration since the beginning of the industrial revolution track temperature increases, Horn showed that average temperatures actually declined slightly from 1943 to 1976 while atmospheric carbon dioxide rose. After the planet warmed again from 1977 to 1990, Horn said there has been no global warming in the past 10 years, yet carbon dioxide has gone up another 15% over the pre-industrial revolution baseline. Horn pointed out that analysis of isotopes from Antarctic ice cores indicate changes in atmospheric carbon dioxide trail temperature increases by 800 years. Horn said natural forces provide much better explanations for climate change stating that ocean currents alternately warm and cool the planet in 25-30 year cycles. He also pointed out that solar cycles correlate with temperature variations. He said that from 1650 to 1720, there were almost no sunspots and this was one of the coldest periods of the little ice age. In concluding, Horn said it is the major forces of nature that primarily control climate; solar cycles, ocean temperatures, and other natural forces. He added “Don’t be shocked if all the predictions for future climate change are wrong.”

Economides blamed “energy militant countries” for pushing oil prices into the triple digits. He said OPEC had little excess productive capacity. However, he emphasized that OPEC likes $100 oil. Economides said the University of Houston had run models that decoupled the influences on oil prices. The model suggested supply and demand put $50 on a barrel of oil, geopolitical pressures and environmentalism adds $60 and the fear factor, primarily Iran, adds $25. Economides said “At $100 oil, former Russian President Vladimir Putin, Venezuelan President Hugo Chavez, and Iranian President Mahmoud Ahmadinejad are 1,000 pound gorillas. At $70 oil they are reduced to monkeys. Their economics depend on $100 oil.” Economides said Russia’s invasion of Georgia had far more to do with energy than freeing South Ossetia. Russia’s true motivation, he held, was to control the flow of crude oil and natural gas from Azerbaijan and the Caspian region to Europe, where 25 countries depend on Russia for 75% of their oil and gas. Economides saw oil prices staying elevated for the foreseeable future. Natural gas prices could go as high as $20 an Mcf by the end of the year, according to Economides if we see two cold spells by December 15th. Longer term, Economides sees natural gas prices falling as LNG begins coming into the U.S. He said once LNG starts coming into this country in a continuous feed, there won’t be the traditional sinussoidal seasonality in natural gas prices and we could see $7 an Mcf natural gas for a long period of time.

U.S. Senator Sam Brownback addressed the KIOGA convention pointing out that most of the infrastructure Russia bombed in their invasion of Georgia was along the Baku-Tbilisi-Ceyhan pipeline to Turkey and railroad lines that carried Azeri oil to western marketplaces. Brownback said “Flush with Petrodollars, you see Russians now acting like old Russians. What the Russians are doing in Georgia is not just about Georgia. It is about energy supply, but it is also a message. It is the Russians saying we are back and we are going to do what we want to do.” Brownback said it is a very serious matter.

U.S. Senator Pat Roberts addressed the KIOGA convention during the opening day describing the New Energy Reform Act of 2008 announced August 1st by the Senate Gang of 10 as “a backroom, let’s do something kind of effort.” Roberts said the centerpiece of the bill was a $20 billion effort to move 85% of new U.S. motor vehicles to nonpetroleum fuels within 20 years through a variety of tax credits and research and development funding. The bill calls for additional leasing in the Eastern Gulf of Mexico as well as off the coasts of Virginia, North Carolina, South Carolina, and Georgia, but also limits tax credits for oil and gas production.

The Kansas Oil & Gas Resources Board (KOGRB) rolled out its first two television commercials. Mark Shreve, KIOGA past-president and KOGRB board member, announced the theme of the KOGRF public information campaign as “Kansas Strong: Energy from the heartland. Strength for our nation.”

In addition, Dave Dayvault, KIOGA Chairman, made special recognition of David Bleakley, Diana Edmiston, Dwight Keen, and Brent Sonnier for their efforts and extraordinary devotion of time analyzing and developing industry responses and proposals on the surface damage issue during last year’s legislative session.

KIOGA Board of Directors and General Membership Meeting

The KIOGA Board of Directors and General membership Meeting featured an update on association activities including governmental relation activities in Topeka and Washington, SemGroup bankruptcy update, surface rights issues, abandoned well plugging responsibility, public relations activities, and by-law changes, and resolutions, and public relations activities and more. Dave Dayvault, KIOGA Chairman, updated the group on the latest information regarding the SemGroup bankruptcy filing and the surface rights issue, David Nickel briefed the group on the recent KCC ruling on abandoned well plugging responsibility, and Edward Cross, updated the group on KIOGA’s federal and state legislative and regulatory activities including updates on the Liaison Committee of Cooperating Oil & Gas Association, Independent Petroleum Association of America (IPAA), and the Interstate Oil & Gas Compact Commission (IOGCC). Cross also updated the group on KIOGA’s public relations activities and on the progress of the Kansas Oil & Gas Resources Fund (KOGRF) unveiling the new KOGRF “Kansas Strong” campaign. The campaign theme “Kansas Strong: Energy from the heartland. Strength for our nation.” has the dual goal of growing a pride for our oil and gas industry and informing the public what the Kansas oil and gas industry means to Kansas’ economy and society. Dave Dayvault, presented by-law changes and resolutions for consideration and the Board of Directors unanimously approved by-law changes and resolutions changing the title of officers to be more consistent with standards used by like organizations, adding additional membership categories, and revising the KIOGA mission statement.

The KIOGA Educational Foundation (KEF) Board of Directors Annual meeting was also conducted where KEF activities were summarized and upcoming activities were discussed. The KEF Board of Directors voted to retain the current slate of officers.

Technical Sessions

Over 200 participants heard technical presentations made during the Conference. Morning technical session speakers and topics included Gary Flaharty, Director of Investor Relations, provided perspectives on global energy basing his outlooks on an analysis of global spare productive capacity, demand, and supply of global oil. Edward Cross, KIOGA President, explored key energy issues facing energy producers and consumers examining current oil and gas markets structures, looking at emerging new realities in energy markets and summarizing the impacts on the Kansas oil and gas industry. Afternoon technical sessions included a discussion of surface rights issues in Kansas by a panel consisting of Dave Dayvault, KIOGA Chairman and CFO of Abercrombie Energy, LLC, Diana Edmiston, Edmiston Law Office, LLC., and Brent Sonnier, OXY USA, Inc. Jerry Morrow, National Business Development Manager for Artificial Lift Systems at Sentry International, provided information and guidelines for selecting the most appropriate artificial lift system for specific applications. Edward Cross, KIOGA President, presented a “Petro Pros” workshop to prepare interested volunteers for delivery of standards-based classroom presentations of KIOGA-developed energy education curricula.

Entertainment

The KIOGA’s 71st Annual Convention evening entertainment event began with a cocktail party followed by dinner as we celebrated KIOGA’s Annual Convention Committee Chair, Mike Reed’s “Rumble in the Jungle”. Entertainment followed dinner with Mike Rayburn “The World’s Funniest Guitar Virtuoso” who used his astounding guitar creations, uproarious songs and truly masterful guitar to create an outstanding show.

Golf and Sporting Clay Tournaments and Ladies Events

The Annual KIOGA Golf Tournament hosted over 200 golfers and was held on two courses, Willowbend and Rolling Hills. The KIOGA Sporting Clays Tournament and Bingo Bash also saw nearly 100 participants. The KIOGA ladies events were well attended. Ladies events included a buffet luncheon and hilarious comedy, Caught in the Net, held at the Crown Uptown Theatre. The ladies events also included a Back to School Brunch which included a walking tour of Wichita State University’s Ulrich Museum of Art and a Bingo Bash. Special thanks goes to our members, sponsors, contributors, supporters, and exhibitors for making the KIOGA 71st Annual Meeting and Convention a resounding success. With this year’s convention behind us, we begin planning for more value-added features to make next year’s convention even more successful!